What is a profit and loss statement at the end of the year?

The profit and loss statement at the end of the year is a summary of the company's income and expenditure for 12 months before the end of the fiscal year. For many businesses, their fiscal year reflects the calendar year and ends on 31 December, but, like many businesses, uses their own fiscal year that ends in a different month than December. This profit and loss statement is usually part of the consolidated financial statements of the company, which is prepared once a year by an independent auditor and can be included in the annual report to investors.

businesses use financial statements to evaluate the status of the company from various perspectives. The four standard statements that are regularly used in the business world are balance sheet, cash flow statements, statements and loss and statement of equity. The profit and loss statement is used to determine whether the business works with or with a loss. It compares revenue with expenditures for a period of time, which is usually anor, but can be as short as one month.

Financial statements can be drawn up at any point from the company's accounting system, but there are some time when the reports are generated for specific purposes. Most companies must generate financial statements at the end of the year, in particular to allow the accounting company to prepare tax reports, to close the payroll per year and comply with the requirements for reporting to government agencies and investors. The profit and loss statement at the end of the year may refer to the end of the calendar year or at the end of the company's fiscal or operational year. The statement will indicate the end of the year at the top of the message. If the end of the end of the year is something other than 31 December, the company uses a fiscal year.

Companies use the profit and loss statement at the end of the year to submit 12 months of income and expenditure, describing in detail the taxes that have been paid to adorn to net income or loss. It tells management and investors whether the company is working with and whether the management hassufficiently ruling expenditure compared to income. It also allows analysts to generate financial conditions on the basis of information that may reveal whether it is appropriate to continue or future investment in the company.

The most important thing is that the profit and loss statement at the end of the year is generated to the Company's accounts in the Company's accounting system. Tax laws set a business cycle for 12 months. At the end of each cycle, the company has to increase revenue and expenses and pay income tax on the basis of results. Another cycle begins with both types of accounts for zero, so there is no confusion about the income already taxed.